Pitney Bowes' Strategy: Resurrect and Reinvent

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Pitney Bowes held a day-and-a-half meeting for 15 market research analysts on April 22-24 in San Francisco. The larger market research firms such as Gartner, IDC and Forrester, as well as niche firms such as Ventana Research, were in attendance. The goal was to introduce the company’s plans related to GIS, location intelligence and customer information management. Directions Magazine was the only publication invited to attend and Executive Editor Adena Schutzberg shares her key takeaways.

Where PB Is; Where It’s Going

Pitney Bowes (PB) is an old company; it celebrated its 94th anniversary as we met in San Francisco. It serves three key business areas:

mailing and shipping solutions

digital commerce solutions

enterprise business solutions

Among the key growth areas are customer information management, location intelligence, customer engagement and e-commerce. What’s really happening, said Roger Pilc, executive vice president and chief innovation officer, is that we are moving from a world of physical products and interactions, to those on the Web, to mobile (about where we are now) to a future world with broader digitization links to people, machines, physical objects and logistics. PB is working to be part of the present and future of these changes. The plan is to focus on business outcomes since that’s what CEOs are demanding. To get there, Pilc said, the company is pursuing multi-disciplinary, globally networked efforts and effective execution.

All of which boils down to this: PB is doing new things, with new people (the new CEO, Marc B. Lautenbach joined in December 2012) in a revitalized company. The rest of the meeting focused on the details.

The Opportunity

James Brayshaw, vice president of Location Intelligence for EMEA, joined PB from Ordnance Survey last year. He discussed the opportunities in the location intelligence areas that are growing. In EMEA, versus the situation in the United States, there is growth in GIS and in particular in local government. He noted 1,000+ targets in the region, about half of which are existing customers and half will be new customers. As an example, he discussed the use of heat imaging and GIS to find illegal housing of immigrants in Slough, UK.

Site selection opportunities are moving beyond the “where do we put the new store or service center” and more toward solving pick-up and delivery challenges related to online ordering via desktop or mobile devices.

There are also opportunities in natural resource exploration and extraction. Mining is a growing industry for PB in Australia and potentially elsewhere.

PB Enables Commerce

James Buckley, senior vice president and general manager of Location Intelligence, was the first to introduce the idea that PB is a commerce enabler. That idea was reinforced later when Bill Borrelle, senior vice president of Brand Strategy and Integrated Marketing Communications, discussed rebranding and suggested that the company’s core belief might be that it’s a catalyst of commerce.

That connection of PB to commerce is easy to see in the context of its tools used to clean and confirm addresses for online sales, such as large multi-national retailers. It’s also easy to see how social media players such as Facebook and Twitter use PB’s reverse geocoding to tag posts for potential use in advertising that enables commerce. It’s perhaps a bit less clear when thinking of a local government using MapInfo to manage parcels. But, when you consider government as an enterprise, commerce is an essential component since it enables assessment and ensures correct payment of taxes. So perhaps, one of PB’s core value propositions is enabling commerce for both private entities as well as governments.

Current Product Mix

While there are many named products in PB’s location intelligence portfolio, in essence, it breaks down into just three:

Spatial Data - Over 350 unique datasets in 240 geographies worldwide (one of the most popular is a global boundaries dataset; apparently no one had tackled that at the level required for today’s social media needs)

The Market Needs Educating

A question posed about the new remote sensing companies (PlanetLabs/Skybox, etc.) and their role in PB’s plans prompted an interesting response from Buckley. He pointed to Jeff Vining of Gartner who observed that CEOs in a variety of companies are enamored with these players, but are not really sure how the data can save their companies’ money or create revenue.

I think that’s been the case with GIS and business geographics for some time. The new imaging products are just the latest iteration of “new” data types. Still, it’s worth noting that the companies who come out on top will be those that make the best case for how to take advantage of new datasets and how related analysis will benefit the customer. We noted in a recent podcast that the companies offering these new imagery products were currently rather short on use cases.

Two New Versions of MapInfo Professional in 2014

Rose Winterton, director of GIS and Applications for Location Intelligence, explained that PB plans two new releases of MapInfo Professional this year:

32-bit for those still using those operating systems, expected in June

64-bit for those using a new version of Windows, expected in October

A new layout designer that can directly access the map for edits is included in both versions. That may eliminate exporting the layout to another design tool before printing, a step some users currently include in their workflow. A new ribbon user interface (64-bit version only) will provide a new look and feel more akin to Microsoft Office.

The 64-bit version will offer multi-threading for many processes (more to come) and will improve the speed of data crunching, something users made clear was required.

PB is merging its two previously acquired raster products, Vertical Mapper and Discover, for a release this October. The release will include a subset of the expected final functionality and will become part of the core MapInfo Pro product. Enhanced functionality including a raster SDK, raster calculator and query engine will be part of the premium licensing (extra fee) which currently provides access to Bing imagery and OpenStreetMap. The format used in the new grid solution is proprietary; Buckley shared that the team looked at potential open formats but none had the required functionality to support size and speed requirements.

From a marketing standpoint, this is a key release. Recent releases provided meager steps forward and many existing users chose not to upgrade. Early customer testers described the new release as “not a new release but a transformation.” Hopefully it will reinvigorate the users, get them to upgrade and sign on for maintenance as they learn the new plans for what had seemed to be an ignored product.

Future MapInfo Pro Enhances and Tech Challenges

A current mobile solution for Android and iOS, Confirm Connect allows users to perform spatial database maintenance via a map interface. PB will use what was learned in its development to create a simple solution for MapInfo Professional users to extend use of spatial data into the field. The plan is for a generic customizable product for field data capture. An enterprise version would connect to Spectrum Spatial.

Workflow Designer is envisioned to enable a simple way, using a visual interface, for users to capture and replay a workflow without coding it in MapBasic. The workflow would be sharable on a server and be accessible to anyone in the enterprise.

PB knows it must explore solutions to overcome the limitations of its TAB file format and improve data performance. It also knows it needs to further explore 3D, as the current solution, Discover 3D, needs a refresh and expansion to areas beyond the geosciences. The company is pondering if the best solution is to buy, build or partner to address 3D requirements. PB realizes that the future of operating systems may not be Windows and that iOS or Android may be the operating system that introduces 20- and 30-year-olds to location intelligence and GIS technology. Winterton also acknowledged explorations were underway regarding alternatives to MapBasic, individual database solutions, and a geoprocessing server.

Representatives from Gartner, Ventana Research, Directions Magazine, among others gathered to hear the new vision for Pitney Bowes.

The Autodesk Relationship

PB announced a strategic relationship with Autodesk in 2012 to better integrate Autodesk products (AutoCAD, Infraworks) with MapInfo Professional. The products can share data and several customers are proving the value proposition. Still, Buckley noted, the growth of the relationship and program “has taken longer than expected.” Autodesk, Brayshaw explained, is doing well “sticking to its knitting,” which I understood as “backing off of GIS and focusing on other areas.”

Geosk: What Happened?

PB partnered with WeoGeo (recently acquired by Trimble) to build Geosk, a tool for MapInfo users to clip out small bits of commercial geospatial data for download. The objective was to solve some data demand needs and ideally provide incremental income for data providers. The product barely launched before it was shuttered. Why? Buckley explained that while there was a small pain point that demanded such a solution, it was simply not large enough to drive Geosk as a viable service. I appreciated the candor of this response and hope it’s a good omen for the new teams to take chances, but to fail fast.

Why do Partners Like Working with PB?

SGSI, once known as Schlosser Geographic Systems, Inc., is a long-time MapInfo/PB partner. It’s one of the most successful, with several Partner of the Year awards. The small company (six!) serves some well-known telecommunications companies. So, why has the firm stood by MapInfo and PB for all these years? Per John Tinker, president at SGSI, the solutions:

just work

are easy to use

there are lots of ways to integrate them with other products (Clarence Hempfield, director and principal manager, Location Intelligence, used the term “fairly open” at one point describing Spectrum Spatial)

scale well from the desktop to the enterprise

grid tools (crucial to telcos) are (and will) be very valuable

Enterprise Location Intelligence is Hot

So, what’s the fastest growing product in the PB GIS/LI/Enterprise space? Spectrum Spatial. I confess, as someone more focused on GIS, Spectrum never made a big impression on me. But now I understand what it is and why it’s selling so well.

Spectrum Spatial is a platform where all the processes of enterprise location intelligence solution “live.” Each process basically becomes a module and clients can pick and choose which ones they need. On the list of modules:

Location Intelligence

Geocoding (global)

Enterprise Tax (U.S. only - tells you what tax goes with a location)

Enterprise Routing (30 countries)

MapInfo Manager (centralized library of spatial assets)

Spectrum Spatial for BI (tool to plug into BI systems, nine of them right now)

Spectrum Spatial Analyst (a confusing name for technology to host the solution locally vs. in the cloud)

Geocomplete (like Google autocomplete, but for addresses; clients can use their own datasets to power it)

PB is known for its geocoding tools and currently supports 122 countries at the point or street level, and 240 countries or territories at the postal code or place level. The geocoding dataset is updated monthly. Reverse geocoding, putting a meaningful location name to a lat/long, is now almost as popular as geocoding. Why? It’s needed to create value for all of those social media check-ins and status updates. Exactly two companies offer such a service. PB’s has two advantages. First, it allows users to reverse geocode against their own datasets (for example, a bank’s database of ATMs, not all ATMs). The second advantage? The other company already has a social media offering and can be considered a competitor to some potential customers.

Future LBS/Social Media Products

Jon Spinney is director of Product Management of Location Intelligence. He set the stage to explore PB’s location-based services (LBS) and social media offerings by offering some factoids:

Navigation and people finding direct revenues (fee for a service) peaked in 2010 and continue to decline. There are now a wide variety of free offering in these spaces monetized in other ways, notably via advertising.

Location, time and connectivity are built into virtually all new software offerings.

Engagement, that is, actual use of the installed applications, is a big challenge for providers. In short, people download and install the apps, but don’t actually use them.

PB, therefore, plans to offer unique, simple services to help these providers enhance their earnings.

Spinney and perhaps PB see location-based services and social media as a pair. Is it possible that in 2014, they are essentially the same thing? If every service embeds location and nearly every one also includes its social tools, links to a social platform, or a gamification component, it makes sense to think of them as one.

Rebranding Pitney Bowes

Bill Borrelle is the new senior vice president of Brand Strategy and Integrated Marketing Communications. Borrelle’s last job was CEO of mcgarry bowen, a New York advertising agency where he was involved in rebranding United Airlines. His team decided to rekindle the “Fly the Friendly Skies” phrase. Why? Because the tag line spoke to a key need of the now merged United and Continental teams: the need to feel good about their brand and empower that friendly airline to grow and maintain a loyal following.

At Pitney Bowes the challenge is different. The brand, if it’s known at all, is associated with its original business in postal meters. The good news is that existing customers understand what the company does and they recommend it. But those who do not know the company don’t share that feeling.

Borrelle and his team thus need to resurrect and reinvent the brand. The good news is that PB has some solid evidence to fuel a new understanding of the company’s role in commerce. For example, noting that the company powers the location infrastructure at Twitter makes people nod, and talk about that on social media, as the company found out in the days after the announcement. Expect similarly head-turning announcements in the coming weeks. The first, a partnership with SAP, was announced earlier this month.

Exactly what PB’s belief system will be and if it will use a new logo are still unclear, but it sounds like the data needed to make those decisions are being collected. Expect a gentle, “dimmer to brighter” rollout of the new branding in the fourth quarter.

My Take

This is a shiny, new, re-energized version of Pitney Bowes. I’ve been following the company since it acquired MapInfo in 2007. There are lots of new faces and frankly quite a bit of positive energy. There’s also a recognition of some missteps and a focus on making things right, both in the product line and for customers. There also seems to be a strong commitment to ask for the input of, and actually listen to, existing customers to develop product and communications plans. All of the speakers were carefully listening to questions, observations and comments from the analysts. This group is not shy.

I, for one, came away from this briefing excited. And, I can’t say I’ve ever felt that way about Pitney Bowes before.

The real proof, of course, is in the execution. Can this revamped PB execute product improvements and innovations as promised? Can it stir its somewhat lost MapInfo user base? Can it begin to speak to the potential customers who have yet to meet the brand? Time will tell.